Many countries are becoming interested in developing their film industries as a way of promoting their national culture and increasing their soft power. With the continued global dominance of Hollywood films, policy makers are increasingly considering government subsidies as an essential
tool in promoting their national film industries. However, the actual effectiveness of subsidies in promoting a film industry remains debatable. In order to better address this issue, this paper evaluates and compares the experiences of France and Korea. Both countries have adopted exactly
the same sequence of instruments—import quotas, screen quotas, and then subsidies—yet have applied almost the opposite subsidy policies. Since the 1950s, France has intensively used subsidies while Korea has not. After more than a half century, these different subsidy policies
have led to very different outcomes. This paper shows that a film industry without significant government subsidies can prosper better in the long term than a heavily subsidized one. This is an important lesson for countries that want to develop their film industry and to promote their culture
by designing effective film policies.

Pacific Affairs is a peer-reviewed, independent, and interdisciplinary scholarly journal focusing on important current political, economic and social issues throughout Asia and the Pacific. Each issue contains approximately five new articles and 40-50 book reviews. Published continuously as a quarterly since 1928 under the same name, it is the oldest English-language journal with a focus on Asia and the Pacific. It enjoys an international reputation based on the high quality of articles, and its extensive book reviews section.